True or False questions

9) 9) The process which requires the calculation of an interval and then selects the items based on the size of the interval is A) random sample selection. B) systematic sample selection. C) computerized sample selection. D) statistical sampling. 10) 10) Which is not a method used by auditors to generate random numbers? A) generalized audit software B) electronic spreadsheets C) random number generators D) systematic sample generators 11) 11) Which of the following audit procedures would not likely detect a cllent's decision to pledge or factor accounts receivable? A) a review of the minutes of the board of directors' meetings B) examination of correspondence files C) discussions with the client D) confirmation of receivables 12) 12) One of the shortcomings in evaluating the allowance for uncollectible accounts by reviewing Individual noncurrent balances on the aged trial balance is 1. it is difficult to compare the results of the current year with those of the previous year. II. current accounts are ignored in establishing the adequacy of the allowance. A) I only B) Il only C) both I and II D) nelther I nor 11 13) 13) Generally accepted accounting principles require that revenue be reported net of sales returns and allowances A) if required by Industry practice. B) if the amounts are material. C) if practical D) any of the above 14) 14) When working with the different variables methods, A) the difference between the mean-per-unit estimate and the difference estimate is the definition of what is being measured. B) difference estimation frequently results in larger sample sizes than any other method. C) stratification can only be used with difference estimation. D) ratio estimation is the method preferred by most auditors since it is simpler to calculate confidence intervals. 15) 15) If an auditor concludes that internal controls are likely to be effective, the preliminary assessment of control risk can be reduced, leading to which of the following impacts on the acceptable risk of Incorrect acceptance? A) The acceptable risk of incorrect acceptance will be increased. B) The acceptable risk of Incorrect acceptance will be reduced. C) The acceptable risk of incorrect acceptance will not be impacted. D) The acceptable risk of incorrect acceptance will be eliminated